Major Companies Are The Engines of Climate Progress
As world leaders prepare to gather for the COP22 climate talks in Morocco, Ceres experts are blogging on low-carbon investor and company actions since the adoption of the Paris Climate Agreement and challenges that remain.
One year ago, dozens of companies announced significant climate and clean energy commitments in advance of the historic COP21 climate agreement forged in Paris last December. They were motivated by the desire to demonstrate to policymakers that they are ready for – and expect – government action to lower global carbon pollution.
As we approach the next round of climate talks in Morocco, one question looms large; having reached a milestone agreement in Paris, and having surpassed the thresholds necessary for that agreement to enter into force, will the business community respond with decisive on-the-ground action to realize a low-carbon future?
The answer is yes.
Governments will of course play an essential role, but it’s the private sector, the business community, that must lead the way – and they are. Not willing to wait for the gears of politics to turn faster, and eager to capitalize on the economic opportunities that the transition offers, many iconic companies are moving now – and moving fast.
I co-lead a program at Ceres that engages directly with a network of more than 50 companies, including two dozen listed on the Fortune 500 that are among those leaders. As advocates, we set a high bar when it comes to our expectations of companies in addressing climate risks and other critical sustainability challenges. Our 20 specific expectations are outlined in our recently revised Corporate Roadmap for Sustainability.
And increasingly the companies in our network are meeting or exceeding those expectations – in fact, more than 80 percent have set specific greenhouse gas emission (GHG) reduction goals. And many are setting goals consistent with the aggressive reduction targets that climate scientists say are needed to avoid catastrophic climate warming.
In the 11 months since the Paris Agreement was forged, we’ve seen impressive climate-related activity among our network companies that proves accelerated progress is not only possible, but also good for the bottom line.
Apple, Bank of America, General Motors and Wells Fargo have all joined the RE100 initiative committing to obtain 100 percent of the electricity they need for their operations from renewable sources like wind and solar. Apple took it a step further by announcing that three of its key suppliers have also made comparable commitments to renewable energy.
AMD, Bank of America and PepsiCo set or committed to set science-based GHG reduction goals, joining Best Buy, Coca-Cola, Dell and General Mills, which set science-based goals prior to Paris. While most Fortune 500 companies have, to their credit, set GHG goals, relatively few have taken the far bigger step of setting goals that the scientific community deem necessary to limit global temperature rise to two degrees Celsius or less.
Of course, GHG and renewable energy goals are not the only answers for tackling climate change. General Motors, Ford Motor Company, and Pacific Gas & Electric have taken decisive steps to accelerate the growth of electric vehicles and electric vehicle infrastructure. General Motors is about to begin selling the Chevrolet Bolt, an all-electric passenger car with a range of well over 200 miles and a price of about $30,000 after rebates and tax credits. Ford announced plans to invest $4.5 billion in vehicle electrification and add 13 electric vehicles to its product line between now and 2020. And PG&E is in the final stages of approval for a bold plan that would add 7,600 electric vehicle charging stations in its northern California service territory.
These examples are just the leading edge of what Ceres expects will be a continued emphasis on corporate investment in climate and clean energy solutions post-COP22.
But we’re far from reaching the scale and pace of global low-carbon investment that is needed – what Ceres calls the Clean Trillion. As we continue to engage with companies in the Ceres network and beyond, our agenda will include:
- A continued emphasis on setting public goals, whether for greenhouse gas reductions, renewable energy sourcing or energy efficiency gains. Simply put, there’s nothing like a public commitment to drive corporate action and accountability.
- Greater emphasis on reducing GHG emissions in company supply chains, which typically have a total carbon footprint three to four times larger than direct operational emissions.
- Elevating corporate voices as part of legislative and regulatory efforts at the state and federal level aimed at reducing carbon pollution. More than ever, policymakers need to hear from businesses why strong climate and clean energy policies will benefit – not hinder – our economic future.
Nearly 200 national governments made a powerful statement in Paris and the corporate community is responding. The upcoming COP22 meetings in Morocco will no doubt affirm these trends and the urgency for even stronger action. We hope and expect more companies will follow suit.